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Review and Commentary: News and corporate governance

What Dow Jones and Reuters teach us about stewardship

London Metropolitan University, UK, editor{at}boardagenda.com

The outcomes of near simultaneous bids for the news organizations Reuters Group plc and Dow Jones & Co. Inc. in 2007 hinged on mechanisms of corporate governance put in place at each company to protect the integrity and independence of the editorial operations. Neither company is a particularly good model of good governance, since the restrictions — super-voting shares at Dow Jones, veto-power by the trustees of the Founders Share Company at Reuters — almost completely rule out an open market for corporate control. This article looks at Reuters — and in even greater detail at Dow Jones, where the private actions of the board and shareholders came into rare public view. It suggests that stewardship theory plays a large role in protecting a perceived social value of the integrity of the news, figuring more heavily in crucial board decision-making than shareholder value. But the outcome of both cases means that the tension between the two is not easily resolved.

Key Words: K E Y W O R D S • case study • corporate governance • Dow Jones • financial information • journalism • mergers • news industry • newspapers • Reuters • stewardship theory • stakeholder theory • takeovers

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